As Head of a private-independent school, you generally operate on a budget that is rooted in tuition and other hard income matched to the cost to deliver your mission to your students. For your school to operate, you must recruit and retain your students and make every attempt to minimize the “gap” between tuition and cost to educate a student—striving to reduce that gap to zero. For continued success, your Trustees should be mapping out a strategic plan and a strategic financial plan to grow your school for future generations. You use your annual fund and other fund-raising efforts to support the “extras” that define your school.
You have a solid framework to evaluate your school for return on investment. Recruitment and retention, “next level” placement for your students, a waiting pool, fund raising. While your school may be non-for-profit or for-profit, you need to operate it somewhat like a business.
But what of the public schools?
The Center for American Progress (CAP) recently published a study called Return on Educational Investment that judged public school districts for their efficiency, using the dollars spent per student with academic achievement as the ROI. Among the summary findings of the report are:
- Student achievement could be boosted with the same expenditures by using money more productively.
- Throwing money at the problem will not automatically improve outcomes—controlled spending is needed.
- High-spending districts are often inefficient, and more disadvantaged students are more likely enrolled in inefficient districts.
- Highly productive districts are focused on student outcomes.
- The nation’s least-productive districts spend more on administration.
- Some urban districts are much more productive than others.
Public school districts’ budgeting and spending is tied to complex factors—federal funding with all the strings attached, the tax bases, demographics (after all, public schools generally do not have the luxury of accepting only mission-appropriate students), and much more.
The report clearly states that the “data cannot capture everything that goes into creating an efficient school system, and there were confounding variables that our study was not able to control for. For instance, school systems with weak tax bases may be subject to greater administrative burdens and have less control over how funds are spent, which might make it harder for them to be efficient.”
While CAP provides a conversation starter, eSchool News reports that education researcher Diane Ravitch said that “this is quite simply an abhorrent way to measure the quality of education. Education is not a business. We can’t know its value for many years.”
You can download the full report here. You can also read a Reuters story here.
